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Ramaphosa win could boost luxury property, especially in Jozi - expert

Jan 04 2018 21:00
Carin Smith

Cape Town - The election of Deputy President Cyril Ramaphosa as ANC president will likely have a positive impact on the confidence of South Africa's luxury property buyers, according to Rory O’Hagan, CEO of the Luxury Portfolio division at Chas Everitt International.

In his view this would likely be the case especially in Johannesburg where the luxury property sector is dominated by SA and African buyers seeking primary residences or secondary homes that are used for business rather than holiday purposes.

“With [Johannesburg] being the financial capital of Africa, there is generally no real shortage of luxury buyers in Johannesburg, but they have been holding back over the past few months in the sense that they have been reluctant to spend more than about R10m to R15m, pending the outcome of the ANC conference," he explained.

“However, the orderly nature of the conference and the election of Mr Ramaphosa as the new ANC president seem to have broken the log-jam, and we have already received a flood of enquiries just in the past few days for homes in the R20m to R30m range.”

The luxury market in Johannesburg’s top suburbs and estates close to Sandton currently offer business buyers and investors excellent value for money, according to O’Hagan. That is why he expects that high-end sales in these areas will pick up strongly over the coming months, and that prices will firm and then start to rise.

“We also expect that the trickle of high net-worth buyers that we have seen moving back to Gauteng from Cape Town over the past year will turn into a steady stream as economic renewal continues and Johannesburg once again becomes a powerhouse of new opportunities,” he added.

Samuel Seeff, chair of the Seeff Property Group, also said the reported slowdown in semigration is also attributable to the slow rate of sales in other provinces combined with high prices in the Western Cape, which has now also put a damper on this market.

Semigration refers to the trend of people relocating, mainly from Gauteng to the Western Cape.    

O'Hagan expects international holiday home buyers and investors to continue to favour Cape Town – although the city’s water problems and the stronger rand are likely to put a damper on prices there for the next few months, in his view.

Lew Geffen, chair of Lew Geffen Sotheby’s International Realty, expects the property market in 2018 to show swift and significant improvement on the back of Ramaphosa’s election.

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